American Surety Co. v. Venner

• Decision Date: 21 May 1903
• Parties: AMERICAN SURETY CO. OF NEW YORK v. VENNER et al.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

183 Mass. 329

67 N.E. 331

AMERICAN SURETY CO. OF NEW YORK v. VENNER et al.

Supreme Judicial Court of Massachusetts, Suffolk.

May 21, 1903

COUNSEL

Hutchins &

Wheeler, for plaintiff.

Anson M. Lyman, for defendants.

OPINION

KNOWLTON C.J.

In a case pending in the Supreme Court of the state of New York an attachment was made upon property of the defendant Venner and the present plaintiff, at his request, agreed with the plaintiff in that suit to pay the amount of any judgment that might be 'recovered in the action against the defendant, not exceeding the sum of five thousand dollars, with interest,' for the purpose of discharging the attachment. At the same time these defendants entered into a contract to indemnify and save harmless the present plaintiff from its liability on the agreement to pay the judgment. In the original case, judgment was recovered in the sum of $8,041.33, and the plaintiff therein demanded payment from the American Surety Company under the agreement. There was a dispute between the plaintiff in the original suit and the defendants in this suit as to the amount for which the present plaintiff was liable under the agreement; the plaintiff in the original suit contending that the agreement included interest on $5,000 from its date, which was February 28, 1889, and the defendants in this suit contending that interest was to be added only from the date of the judgment which was November 21, 1894.

The language of the contract of indemunity, in the material part is as follows: 'That said parties of the first part [the present defendants] shall and will at all times indemnify and keep indemnified and save harmless the said company [the present plaintiff] from and against all loss, damages, costs, charges, counsel fees and expenses whatsoever, which said company shall or may for any cause, at any time, sustain or incur by reason or in consequence of said company having executed said instrument, and do further covenant and agree to pay to said company and its representatives, all damages for which said company or its representatives shall become responsible upon the said undertaking, before said company or its representatives shall be compelled to pay the same, any sum so paid, however, to be applied to the payment of such damages; and in case any suit, action, or other proceeding shall be commenced, or notice served on said parties of the first part, in any manner relating to or growing out of the matter or business for or on account of which the aforesaid instrument was required to be executed, immediate notice thereof shall be given to said company at its office in New York.' There was also a provision that in case of a default on the part of these defendants to perform any of 'the covenants, agreements or conditions' of the contract, they would substitute other sureties on the undertaking within 15 days after receiving notice of their default, and, in case of failure so to furnish other sureties, would pay any damages or expense that the company might incur in obtaining a release from its undertaking as surety. On the demand of payment of the judgment by the original plaintiff, the present plaintiff made a demand upon these defendants; and after a failure to agree--the present plaintiff demanding the sum claimed by the original plaintiff, and the present defendants offering to pay only $5,000, with interest from the date of the judgment--these defendants tendered this amount, and the plaintiff declined to accept it. It was then agreed, without prejudice to the rights of either party in reference to the tender, that the question in dispute should be decided in a suit brought in ...